A boycott that gained steam on social media and within certain political circles has had a large impact on the sale of a key product for a public company.
Here’s a look at the impact of the Bud Light boycott and what’s happening to the U.S. beer market.
What Happened: Controversy surrounding Bud Light, a beer brand owned by Anheuser-Busch InBev SA BUD, has impacted the sales of the top-selling beer and could put further pressure on shares of the parent company.
Bud Light sparked backlash with its collaboration with trans activist Dylan Mulvaney, who announced a partnership with the beer brand on social media.
The partnership upset many people, including Kid Rock, Travis Tritt and other musicians who were previously big fans of the beer.
Calls for boycotts of Bud Light and other Anheuser-Busch InBev brands have risen by celebrities and beer drinkers as they see the inclusion of Mulvaney as part of “woke culture.”
Boycotts have had an impact on sales of Bud Light with a new report saying Bud Light is no longer the bestselling beer brand in the U.S.
In the month of May, Modelo Especial topped the leaderboard with 8.4% market share of the U.S. retail store beer sales according to Nielsen data and a Wall Street Journal report.
Bud Light ranked second with 7.3%. Reports indicated that Bud Light sales fell 23.9% in the month of May and were trending down even more in the last four weeks.
A chart in the report showed Bud Light had a 10.3% market share in late January before falling to 8.7% in April and now below 8%. Bud Light passed Budweiser, known as the King of Beers, for the title of bestselling U.S. beer in 2001.
Ranking behind Modelo and Bud Light are Coors Light and Miller Lite at 6.2% and 5.3%, respectively. Both of these brands also saw an uptick in their market share in the recent month.
The report said that Budweiser and Michelob Ultra, both owned by Anheuser-Busch InBev saw sharp drops in the last month on the heels of the boycott.
Related Link: Mark Cuban Navigates The ‘Woke’ Whirlwind: Are Bud Light, Target Playing Their Cards Right?
Why It’s Important: The declining sales of Bud Light and other Anheuser-Busch InBev brands could be bad news for the key time period between Memorial Day and the Fourth of July and also the summer months across America.
Reports have said distributors are having a harder time selling the beer brands from Anheuser-Busch InBev with reports of declined sales at retailers and at bars. Anheuser-Busch InBev has offered to buy back expired product, but it could be faced with decisions of layoffs amidst the declining sales.
While the boycott is bad news for Anheuser-Busch InBev, it could provide good news for competitors like Constellation Brands, Inc. STZ, which owns Modelo.
The beer, which is a Mexican import, had been gaining in market share in recent years.
Even more newsworthy might be the fact that Constellation Brands acquired the U.S. rights to Modelo from Anheuser-Busch InBev in 2013 as part of a push by Anheuser-Busch InBev to gain clearance for its acquisition of Grupo Modelo.
At the time, Modelo was not a top 10 U.S. beer brand, which could provide a testament to the strength in the growth of the brand and Constellation’s marketing and focus on growing the brand.
Price Action: Shares of Anheuser-Busch InBev are down 4.9% year-to-date in 2023. Shares have fallen around 15% since the start of April when calls for boycotts began.
Shares of Constellation Brands are up 8.7% year-to-date in 2023.
Shares of Molson Coors Beverage Co TAP, which produces Coors, Miller and Molson, are up 37% year-to-date in 2023.
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Photo: Shutterstock
Image and article originally from www.benzinga.com. Read the original article here.